- Many observers were surprised last week when George W.
Bush came down in favor of the People's Republic of China, against a democratic
referendum in Taiwan. His weighing in on behalf of mainland China becomes
more questionable at a time when well-connected Chinese companies are funneling
large sums of money to Bush's brothers.
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- News reports reveal that Shanghai-based Grace Semiconductor
Manufacturing, a multi-billion-dollar company co-founded by a son of China's
former president, has presidential brother Neil Bush under a $2 million
contract.
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- With no background in semiconductors, Neil Mallon Bush,
third brother in the family, got a five-year contract from Grace, involving
an annual retainer of $400,000 in stock. The arrangement is disclosed in
court papers in Mr. Bush's scandal-ridden divorce. The business press has
conjectured that Grace hoped to influence US limits on exporting sensitive
technology to China.
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- An even bigger Chinese company recently moved in ways
that benefit youngest Bush brother Marvin P. Bush. The company is Hong
Kong-based Cheung Kong Holdings, a gargantuan real estate and investment
conglomerate now branching into biotechs. According to the company, "combined
market capitalization of the Cheung Kong Group amounts to HK$515 billion,"
or "approximately 11.5 percent of the total market capitalization
of the Hong Kong stock market."
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- Cheung Kong's portfolio now includes Critical Path, Inc.,
a California-based software and Internet-messaging services company that
lost money for the first nine months of this year. The company's SEC filings
list as a significant shareholder Mr. Purnendu Chatterjee, acting for Winston
Partners LP, a company co-founded by Marvin P. Bush. Recent filings show
that Chatterjee's group including Winston Partners owns about 5.5 million
shares in Critical Path (6.82 percent). Cheung Kong already owned substantial
shares in Critical Path in December 2001. Its backing can only solidify
the net worth of Critical Path, which has faced class action litigation
and has changed top managers a couple of times in the past three years.
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- It thus cannot but help boost Winston Partners, a private
investment firm in northern Virginia formed by Bush with longtime business
associate A. Scott Andrews.
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- There is no law forbidding a foreign corporation from
investing in an American company just because a president's relatives hold
financial interest in the same company. But there are some instances where
taste and judgment, as well as explicit law, should come into play. It
is not appropriate for a brother of a sitting president to take money from
foreign companies, when we have such strict laws about disclosure that
a president or First Family member who receives foreign gifts has to disclose
every pair of earrings or belt buckle. Such gifts usually go to the American
people after a president leaves office, and the Smithsonian Museum of American
History has a charming exhibition of gifts to previous presidents and First
Ladies.
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- These deals, au contraire, are not being exhibited. The
White House and the Bush brothers have not responded to questions and requests
for information. (Questions to the companies, to the CIA and to the FBI
have not yet been answered.)
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- The deals are known in the international business community,
where they must make an unfortunate impression. Marvin Bush is the former
head of the Republican Party in Virginia, worked with the late GOP operative
Lee Atwater, and has campaigned and networked extensively for his father
and brother, as well as for other GOP candidates. He was also a Bush "Ranger,"
one of a group that raised at least $100,000 in political contributions
to Bush's campaign in 2000. Neil Bush has campaigned for Republican candidates,
has traveled the globe on behalf of the White House and has also stumped
foreign nations for business deals for his educational software company.
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- This is "restoring honor and dignity to the White
House?"
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- Cheung Kong Holdings and Grace Semiconductor are part
of the intensely networked Chinese economy, with a high degree of public-private
partnership. For Bush to allow his relatives, especially close relatives,
to benefit financially from deals with well-connected firms in what we
used to call "Red China" is, at best, a sorry reflection on his
taste. For him to follow these deals with a massive shift of support to
China, especially one that discourages a democratic referendum in Taiwan,
is a worse reflection.
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- - Margie Burns is a freelance writer in Washington, DC,
and can be reached at margie.burns@verizon.net.
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- Copyright © 1998-2003 Online Journalô. All
rights reserved.
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- http://www.onlinejournal.com/Special_Reports/121603Burns/121603burns.html
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